One of the largest franchised hotel owners for an international hotel group engaged Remington to secure financing for its portfolio of 2200 hotel rooms located in Orlando, FL. However, the challenges to complete the financing appeared insurmountable. The aging properties had lost their competitive edge to new hotels being developed in their market place and as a result slipped into bankruptcy. The second challenge was that they properties had approximately $100MM in first mortgage debt and where worth about $70MM. Just to add a bit more complication, there were significant environmental problems. Remington was given 30 days by the court to submit a resolution plan along with a commitment for funding. At the time the borrower engaged Remington, they were of the mindset that they were going to give the properties back to their lender as the borrower had already endured over 18 months with numerous other investment banks and advisors that failed to rise to the challenge.

Remington recognized that this portfolio was not an asset that the lender wanted. Based on its standing relationship with the existing lender, Remington was able to negotiate a discounted pay-off on the senior financing. This event triggered a taxable liability to the borrower that required additional funding to fund this expense. Also, the environmental problem required significant funding to correct. To solve these needs and the need for additional funding to invest into the properties to help reposition and upgrade the portfolio and make competitive within its market, Remington had to secure mezzanine financing for a very speculative business plan.

Remington was able to secure market rate non-recourse senior financing and participated in the mezzanine funding tier to provide a $58MM package of financing that allowed the borrower to retain 100 percent ownership in the properties and emerge from bankruptcy. The transaction closed in 45 days.